There are well-documented racial and ethnic disparities in the costly and often preventable outcomes of mortality, readmission, and prolonged hospitalization due to the common conditions of heart failure, pneumonia, and acute myocardial infarction. The causes and solutions for these disparities, however, are not clear. Evidence has begun to point toward differences in the hospitals where most minorities and non- minorities receive care as a source of disparities. Surprisingly, two important factors and their interrelationship, which may explain how hospital differences are associated with disparities and point to opportunities for targeted intervention, have received insufficient attention: the quality of nursing in the hospital in which patients are cared for and the characteristics of the neighborhoods of patients served by different hospitals. Nurses provide vital bedside care, 24/7 surveillance, education, and care coordination that may narrow disparity gaps, but little is known about the degree to which minority patients are treated in hospitals with lower quality nursing and the effect of these differences on disparities. Nursing as a systems factor is an appealing feature to study because unlike many hospital characteristics, it can be improved through intervention by administrators or policymakers. Evidence suggests that most minority older adults are cared for in a relatively small proportion of hospitals. The quality of the nursing care environment (including nurse staffing level, level of nurse education, and a care environment supportive of professional nursing practice) can vary significantly from hospital to hospital and these factors affect patient outcomes. If differences in nursing care environment are shown to be associated with disparities, strategies targeting nursing in hospitals that predominantly serve minority- populations could be implemented. We must also consider that outcomes variation by hospital may reflect differences in the populations that different hospitals treat. Although researchers often account for differences in individual characteristics, the effect of the hospital environment is rarely examined in relation to the effect of the neighborhood where patients live. Research shows that the socio-ecological qualities of an older adult's neighborhood (e.g., socioeconomic position, segregation, and primary care services availability) impact health outcomes. In addition to an independent effect, we expect that neighborhood factors affect older adults' access to high-quality hospital services including quality nursing care. We will use multilevel and cross-classified models as well as geographic information systems (GIS) methods to examine unique survey data from hospital nurses along with Medicare claims data that is geocoded and linked with neighborhood data. Our approach will allow us to untangle the interrelated effects of the hospital care environment and patient neighborhood on racial and ethnic disparities in hospital outcomes among older adults, point to interventions that may reverse disparities, and identify communities and hospitals that can most benefit from interventions.